Real GDP contraction of 6.3% is expected in 2021

Although the Moroccan economy shows some signs of recovery in this pandemic situation, the World Bank indicates in a monitoring report on Morocco’s economic situation prepared by its economic department, that the situation remains fragile, given the recent deterioration of the economy. the epidemiological situation.

In this uncertain context, the same department announces that a real GDP contraction of 6.3% is expected in 2020 in the Kingdom while a return to the level prior to the pandemic should not occur before 2022. As in d ‘ other countries around the world, the current crisis will cause the budget deficit to increase significantly to 7.8% of GDP in 2020, and public debt is expected to exceed 76% of GDP. The current account deficit is also expected to increase to 6% of GDP this year, the same source said.

Morocco’s real gross domestic product (GDP) is expected to contract by 6.3% in 2020 and the return to the pre-pandemic level of the new coronavirus would not be possible until 2022, Javier Diaz Cassou said on Thursday. , Senior Economist of the World Bank (WB) in Morocco.

During a round table dedicated to the presentation of the monitoring report on Morocco’s economic situation entitled ” From emergency response to recovery ”, Javier Diaz Cassou, senior economist of the World Bank (WB) in Morocco and author of this report produced in collaboration with Amina Iraqi, economist at WB, recalled that the Covid-19 pandemic abruptly interrupted more than two decades of sustained socio-economic progress in Morocco.

In 2020, the country is expected to experience its first recession since the 1990s, and the economic contraction that took place in the second quarter, largely coinciding with containment, is the largest on record. “, he said.

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The same official of the WB in Morocco stressed that this is the result of the combination of supply and demand shocks and external shocks caused by the pandemic, but also the effects of unfavorable climatic conditions on agricultural production.

Indeed, the crisis had a severe impact on jobs and household income, generating peak unemployment and a deterioration of poverty and vulnerability indicators, the official said.

Regarding the Moroccan GDP, Javier Diaz Cassou acknowledged that this index has indeed known ” a very marked drop in the 2nd quarter of 2020 going up to -15%, with a slight economic recovery in the 3rd and 4th quarters ”. The manager notes that between the 3rd quarter of 2019 and the 3rd quarter of 2020, the Moroccan economy lost more than 580,000 jobs, especially in rural areas.

In addition, Cassou explained that despite the gravity of the crisis, Morocco is better placed than other emerging economies to weather this storm thanks to the credibility of its macro-fiscal framework, its relatively large external buffers and its easy access to international financial markets.

At the start of 2021, which promises to be rather good with the launch of several vaccination campaigns in the four corners of the world, several risks must be followed closely in Morocco, namely the room for maneuver of economic policy to cope. to a possible worsening of the health or international crisis, the external financing conditions which could deteriorate, and the financing needs which are high, the report insists.

It will also be important in 2021 to follow the evolution of overdue deadlines in a context of increasing payment deadlines, the significant accumulation of contingent liabilities linked to the guarantee programs put in place by the government and the need to push forward the economic growth above pre-pandemic levels.

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Eric Le Borgne, Head of the macroeconomic trade and investment department thus indicated that the monitoring report of the economic situation of Morocco, which is a semi-annual report from the economic department of the World Bank ” is part of a new series that we will start publishing specifically on Morocco “.

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